Insurers have a challenge which insurtechs can help with. The C-Suite has to balance the often contradictory goals of the short and longer term. Take three planning and deployment approaches: -

This year and next year out

3 to 5 years out

6 to 10 years out

There is an urgent imperative to face the disruptive challenges from various fronts;

First off the block innovative insurers

Full-stack insurtechs

The dangers Amazon, Zhong An and others pose of commodising insurance by capturing the buying/distribution part of the value-chain

The innovation planning stages are already in full swing across all three areas; there is no time to lose in deploying the minimal viable product (MIV) that makes the difference this year and next. Otherwise, as McKinsey persuasively shows the winner takes all the profits - Read page 9 of "Facing Digital Reality".

That means you have to choose the right partners and technologies for the MIV. No one vendor can deliver everything so which mix of platforms, products and services delivers the MOV that will wow customers and beat competitors. That's the value of the insuretchs across Europe, North America, APAC and increasingly Africa.

The MIV you specify must be deliverable this year and continuously improved next year. That's the starter for strategy approach 1.

Yet therein lies a danger!

This "Go to Market" fast approach must not compromise the second two approaches looking three to five years out and up to 10. Stage two gives the insurer the time to gain the resources, train people and deploy technologies like AI which can only succeed in when combined with all the other parts of the technology stack such as data management.

That gives a chance to tackle the up to 10 years out potential benefits of, say, blockchain.

On a recent tour of US insurers Paul Stanley, CEO of 360Globalnet heard a frequently expressed worry: -

" InsureTech is so fragmented with people addressing discrete parts of a process we insurers are faced with piecing together a "1,000 piece baked bean jigsaw" to make it work whereas in contrast when you present something built for purpose we can see all our future digital functionality in one place and a roadmap that goes beyond ours."

That lead me to propose that insurers should avoid being sucked into interminable engagement with insurtechs but this reflection from Thomas Verduzco-Weisel Global Claim Automation Solution Specialist at Shift is important.

"1. For first insurtech experiences, I think it’s fine / manageable for insurers to work with those “fragmented” startups.

2. When insurers then want to truly go ahead with their own transformation, they must look towards more comprehensive providers. Insurers are no services orchestrators (YET) and they surely don’t want to create new (future) legacy issues by working with 10s or 100s of different tech solutions. Only once they will have overcome their own legacy problems and have platforms and organizational structures where services can dock into via API, they will have arrived at their next evolutionary step."

That next step must also address the following challenge.

INSURERS cannot afford the escalating costs of multiple platforms. The person in charge of the enterprise technology stack has to cap these costs even whilst being charged with enabling growth.

The answer has to be a platform that can deliver the results the CEO demands this year and next whilst also enabling the innovative roll-out of AI, orchestration of the supply chain and don't forget blockchain in case it's a future game-changer.

It is too easy to rush into the what, when, who, how and where but first you must be able to explain WHY?

Too many POCs start without that question being asked and answered. That's why too many POCs never end and just get extended. Or they do end without a decision or action. In that desperate outcome lies failure as competitors leave you in the dust.

As an friend of old, Christopher Surdak, who vitally helped me get a $35 million CAPEX authorisation signed off for successful digital transformation of a hotel group said recently; -

"Mike, transformation means different outputs, not different inputs. Worrying about what platform to use, without new outcomes, is like arguing over the color of the umbrella in a mai tai... on the Titanic."

If you want to know the scale of the challenge you face I do recommend his book"Jerk 12 Steps to Rule the World". It has shaken many a CEO and C-Suite member to conquer disruptive competitors.

{

All the same, that did not prevent younger startups – such as Ledger, ManoMano and Alan – from closing significant fundraising rounds. With a crop of emerging stars in fields ranging from cryptocurrency to Artificial Intelligence to software as a service, Paris is working hard to become one of the globe’s foremost technology hubs.